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Perth, June 17, 2010 (ABN Newswire) - West Australian resource developer Stirling Resources Limited (
ASX:SRE) today announced a series of initiatives to reorganise the group's investment and development strategy.
Stirling is the major shareholder, owning and controlling:
"Our target is to reduce the group's overall corporate, administrative and overhead costs by bringing the copper and zircon projects together as business units of Stirling. This rationalisation will save some A$1.5m per year in corporate public company costs" he said.
Strategic Changes:
1. Stirling will seek to merge with Matilda Zircon and Redbank Copper. The terms and conditions of the proposed mergers are in the process of being negotiated.
2. Delay the recommencement of mining for Swan Gold.
3. Seek a significant strategic partner to continue the development of Swan Gold's Mt Ida and Carnegie projects.
4. Reduce board members.
The original intention was to seek relisting in early May. This has been delayed by several months due to the requirement by statutory authorities for the 2 half yearly and 2 annual reports during the time of Administration to be prepared and audited.
This requirement took some 10 weeks of accounting catch up and auditing time costing in the order of A$500,000 of unexpected expense and delay.
The expense together with delays in mining start up and subsequent gold revenues has placed pressure on working capital.
Swan Gold was in the process of securing a A$10m funding package when the RSPT issue unfolded.
Notwithstanding these events are beyond the control of Swan Gold, Stirling Resources as the facilitator of the recapitalisation is mindful these delays are regrettable to those who participated in the recapitalisation process by acquiring Swan Gold stock.
In order to address this situation Stirling Resources intends to issue (at no cost), on a 1 for 10 basis, one Stirling share for every ten Swan Gold shares acquired from Stirling Resources during the recapitalisation of Swan Gold.
This will result in 12,850,831 new Stirling shares being issued by Stirling Resources, subject to compliance with the ASX Listing Rules and the Corporations Act.
It will now be a requirement of relisting for Swan Gold to demonstrate it has sufficient working capital to meet its commitments.
'Once funding is secured, relisting will be imminent. We anticipate this may take 1 or 2 months to complete' Mr Kiernan said.
Stirling Resources major shareholder DCM DECOmetal, considers the reorganisation appropriate and supports the strategic direction.
DCM's Managing Director, Dr Rohtraut Skatsche-Depisch commented "We think this is a good way forward particularly with the current difficulties confronting the Australian resources industry and we are totally supportive of Stirling's new strategy".
ASX:SRE) today announced a series of initiatives to reorganise the group's investment and development strategy.Stirling is the major shareholder, owning and controlling:
Matilda Zircon Limited (Stirling's Managing Director, Michael Kiernan, commented that due to the current hiatus in sourcing funding for junior miners, as a direct result from the knock-on effect of the Resources Super Profits Tax debacle, we need to cut our cloth accordingly and adapt to the present climate.
"Our target is to reduce the group's overall corporate, administrative and overhead costs by bringing the copper and zircon projects together as business units of Stirling. This rationalisation will save some A$1.5m per year in corporate public company costs" he said.
Strategic Changes:
1. Stirling will seek to merge with Matilda Zircon and Redbank Copper. The terms and conditions of the proposed mergers are in the process of being negotiated.
2. Delay the recommencement of mining for Swan Gold.
3. Seek a significant strategic partner to continue the development of Swan Gold's Mt Ida and Carnegie projects.
4. Reduce board members.
Stirling: Jeremy Shervington and David Nabarro will step down.
Board will comprise of:
Michael Kiernan - Chairman
Rohtraut Skatsche-Depisch
James Kiernan
Giga Bedineishvili
Matilda: Michael Kiernan, Bruce Maluish and John Baxter will step down.
Board will comprise of:
Mal Randall - Chairman
Peter Gazzard - Technical Director
Keith Vuleta
Nathan Wong
Redbank: James Searle and Michael Kiernan will step down.
Board will comprise of:
Ian Price - Chairman
Bruce Morrin - Managing Director
Allan Brown
Keith Vuleta
Swan Gold: Bruce Maluish and John Baxter will step down.
Board will comprise of:
Michael Kiernan - Chairman
Ian Price
Allan Brown
Keith Vuleta
5. Re-listing Swan GoldThe original intention was to seek relisting in early May. This has been delayed by several months due to the requirement by statutory authorities for the 2 half yearly and 2 annual reports during the time of Administration to be prepared and audited.
This requirement took some 10 weeks of accounting catch up and auditing time costing in the order of A$500,000 of unexpected expense and delay.
The expense together with delays in mining start up and subsequent gold revenues has placed pressure on working capital.
Swan Gold was in the process of securing a A$10m funding package when the RSPT issue unfolded.
Notwithstanding these events are beyond the control of Swan Gold, Stirling Resources as the facilitator of the recapitalisation is mindful these delays are regrettable to those who participated in the recapitalisation process by acquiring Swan Gold stock.
In order to address this situation Stirling Resources intends to issue (at no cost), on a 1 for 10 basis, one Stirling share for every ten Swan Gold shares acquired from Stirling Resources during the recapitalisation of Swan Gold.
This will result in 12,850,831 new Stirling shares being issued by Stirling Resources, subject to compliance with the ASX Listing Rules and the Corporations Act.
It will now be a requirement of relisting for Swan Gold to demonstrate it has sufficient working capital to meet its commitments.
'Once funding is secured, relisting will be imminent. We anticipate this may take 1 or 2 months to complete' Mr Kiernan said.
Stirling Resources major shareholder DCM DECOmetal, considers the reorganisation appropriate and supports the strategic direction.
DCM's Managing Director, Dr Rohtraut Skatsche-Depisch commented "We think this is a good way forward particularly with the current difficulties confronting the Australian resources industry and we are totally supportive of Stirling's new strategy".
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About Stirling Resources Limited
Stirling Resources Limited (ASX:SRE) is a West Australian resources developer focusing on investment and development of copper, zircon, coking coal, gold and iron ore projects. The Company consists of highly experienced resource development and mining personnel with track records of creating shareholder value.
Previously the group took control of a financially distressed manganese producer and developed it into a diverse mineral commodity producer to become included in the ASX 200 and was ultimately taken over by an international conglomerate for A$1.25b. The Company grew from being a small unreliable manganese producer to ultimately supplying 10% of the world's high grade manganese to global customers and developed significant projects in chromite, nickel, copper, zinc and iron ore.
The Company's strategy for creating shareholder value is to identify projects that comprise either commodities that are considered to have strong future demand or geological characteristics that have potential and yet for various reasons have not achieved their possibilities. The focus is on brown fields projects close to development or production.
Driven by the underlying fundamentals of the Chinese economy and the continued massive urbanisation process commodities such as copper, zircon, gold and iron ore will continue to be in strong future demand. The Chinese growth is augmented by the Indian economic growth particularly in the steel industry leading to increasing demands of coking coal.
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Related Companies |
>>> Matilda Zircon Limited >>> Redbank Copper Limited >>>       Stirling Resources Limited>>> Swan Gold Mining Limited |
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